In what is one of the biggest global acquisitions to be announced this year, Marathon Petroleum Corp. has agreed to sell its chain of Speedway convenience stores and gas stations to 7-Eleven for $21 billion in cash. The transaction is expected to close in the first quarter of 2021, subject to customary closing conditions and regulatory approvals.
The deal includes about 3,900 convenience stores.
"This acquisition is the largest in our company's history and will allow us to continue to grow and diversify our presence in the US, particularly in the Midwest and East Coast," said Joe DePinto, president and CEO of 7‑Eleven.
7-Eleven's parent, Japan's Seven & i Holdings, has been seeking a global acquisition to expand beyond its home market, according to CNN. At the same time Marathon Petroleum announced it planned to spin off Speedway last October, following pressure from activist investor Elliott Management to split Marathon into three companies. One of those companies was to be a standalone Speedway.
"This transaction marks a milestone on the strategic priorities we outlined earlier this year," said Michael J. Hennigan, Marathon's president and chief executive officer. "Our announcement crystalizes the significant value of the Speedway business, creates certainty around value realization and delivers on our commitment to unlock the value of our assets.
The benefits of the deal include complementary geographic footprints between Speedway and 7‑Eleven that have little overlap. 7‑Eleven currently has over 9,800 stores in the US and Canada and with Speedway's portfolio of approximately 3,900 stores, this acquisition will bring 7‑Eleven's total number of stores to approximately 14,000 in the US and Canada. Following the transaction, 7‑Eleven will have a presence in 47 of the top 50 most populated metro areas in the US.
Nomura Securities International, Inc. and Credit Suisse are acting as 7‑Eleven's financial advisors. Both Nomura and Credit Suisse provided 7‑Eleven's Board of Directors with a fairness opinion.
Affiliates of Credit Suisse and Sumitomo Mitsui Banking Corporation (SMBC) provided committed financing for the acquisition. SMBC and SMBC Nikko also provided financial advisory services to Seven & i Holdings Co., Ltd. in regards to the financing consideration.
Akin Gump Strauss Hauer & Feld LLP and Nishimura & Asahi are providing legal counsel.
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Erika Morphy
Erika Morphy has been writing about commercial real estate at GlobeSt.com for more than ten years, covering the capital markets, the Mid-Atlantic region and national topics. She's a nerd so favorite examples of the former include accounting standards, Basel III and what Congress is brewing.
